CHAPTER 1 ADMINISTRATION & REPORTING

1 2018 TxCDBG Project Implementation Manual SECTION A - CHAPTER 1 ADMINISTRATION & REPORTING Requirements 9/1/2018 1 CHAPTER 1 ADMINISTRATION & REPORTING TABLE OF CONTENTS Page Project Startup .. 2 Pre-Agreement .. 2 Contract Execution .. 3 Establish a Local Administrative Structure .. 3 Administrative Thresholds .. 4 REPORTING and Recordkeeping .. 5 Establish a Record-Keeping System .. 5 Progress Reports and Requests for Payment .. 6 Four Month Call/Meeting .. 6 Technical Assistance for Contracts Behind Schedule .. 6 Other Technical Assistance .. 7 2018 TxCDBG Project Implementation Manual SECTION A - CHAPTER 1 ADMINISTRATION & REPORTING Requirements 9/1/2018 2 CHAPTER 1 ADMINISTRATION & REPORTING This CHAPTER highlights the steps in getting started and implementing your TxCDBG contract for successful project management.

2 Prior to implementing a project, a Locality should put systems in place that will allow it to track and report on its activities as required by its contract with TDA. Project Startup Pre-Agreement Pre-award costs are those incurred by the Grant Recipient prior to the contract start date of the TxCDBG grant award directly pursuant to the negotiation and in anticipation of the TxCDBG grant award, where such costs are necessary to comply with the proposed delivery schedule or period of performance. Such costs are allowable only to the extent that they would have been allowable if incurred after the contract start date of the TxCDBG award and only with the written approval of TDA. The Grant Recipient may request written approval to utilize the Pre-Agreement Policy in order to pursue early implementation of the project.

3 TDA, in its sole discretion, may approve the written request. If the Grant Recipient receives an award and the Pre-Agreement Policy has been requested and approved, the award letter sent by TDA to Grant Recipient will grant authorization to incur Pre-Agreement expenses. Fund specific requirements and restrictions on the type of activities eligible as pre-agreement costs are addressed in the grant application guidelines. In order to be eligible for TxCDBG grant funding or match funding, or both, costs incurred during the pre-agreement phase must be incurred: 1) after the TDA pre-agreement date (application due date or other date specific to the funding category); 2) after the administrative/engineering services contract award date (formal approval by elected body); AND 3) during the contract period identified in the administrative/engineering services contract ( Time of Performance in the Implementation Manual Appendix D and E, sample contract) - the services contract period may begin prior to the date that the services contract was executed.

4 TDA will allow the Grant Recipient to incur costs for CDBG activities before the TxCDBG contract start date and to charge these pre-agreement costs to the grant, provided that the activities are eligible costs, meet the objectives of the program, and are authorized pursuant to applicable state and/or federal law. Procurement for grant expenditures must be specific to the project described in the application and must be supported by adequate documentation. All requests for reimbursement of pre-award costs are subject to review by TDA for determination of whether such expenses are allowable and eligible costs. Failure to meet all contract obligations will result in the required repayment of any pre-agreement expenses which were reimbursed by TDA. The Grant Recipient may not incur costs or expend any contract funds for project construction prior to: Meeting the Environmental Review requirements in the TxCDBG contract (see CHAPTER 3); and Meeting all special condition requirements in Exhibit D of the TxCDBG contract that are required to release construction funds (see CHAPTER 4).

5 2018 TxCDBG Project Implementation Manual SECTION A - CHAPTER 1 ADMINISTRATION & REPORTING Requirements 9/1/2018 3 Contract Execution The Grant Recipient must have an executed contract with TDA before funds can be drawn down through the State of Texas' Purchase Voucher system. An example of the contract is found on the TDA website. Besides the contractual obligations owed between the State and the Grant Recipient, the contract specifies the following as Exhibits: 1) Exhibit A - the Performance Statement - Outlines the scope of the work to be performed under this contract by activity; 2) Exhibit B - the Budget Specifies the contract budget line item by line item, which is used in the drawdown process. This Exhibit also includes all Other funds involved that are necessary to complete the Performance Statement specifics of this contract; 3) Exhibit C Project Implementation Schedule Specifies a timetable for milestones in project implementation.

6 4) Exhibit D Special Conditions Details the specific requirements for the release of construction funding The chief local elected official for the Grant Recipient and the TDA Deputy Commissioner both must sign the contract before the contract is considered fully executed. Ready to Proceed Rule Prior to executing the contract, TDA will ensure that existing contracts are in good standing and will require that the following are resolved to TDA s satisfaction within ninety (90) days after the contract award date: Readiness to proceed issues regarding the current award; and Outstanding issues on existing contracts regarding compliance with program requirements. If the issues identified by TxCDBG staff at the time of the funding award are not addressed within the required 90 days, the TDA Deputy Commissioner will not execute the contract and the TxCDBG funds awarded will be withdrawn and reallocated.

7 Establish a Local Administrative Structure Each Grant Recipient must establish a local administrative structure to complete the grant. The Eligible Activity and National Objective requirements are not met until the project is completed, and there is sufficient documentation to ensure that the project is consistent with the designated National Objective. The Grant Recipient must: Establish a record-keeping system to document compliance with all federal, state, local, and program requirements. o Grant files must be kept at city or county offices or buildings in which government records are maintained and accessible to the public throughout the contract period. o Records shall be retained for the greater of three years from closeout of the grant to the state, or the period required by other applicable federal and state laws and regulations.

8 Review local charters, resolutions, ordinances, and policies that may be relevant to the project; Determine whether day-to-day ADMINISTRATION of the project will be conducted by local staff or by a certified third-party consultant, and which party will conduct each administrative activity; Texas Community Development Block Grant Program recipients have the final legal responsibility for the locally maintained grant files, the timely submission of reports, and compliance with program guidelines. 2018 TxCDBG Project Implementation Manual SECTION A - CHAPTER 1 ADMINISTRATION & REPORTING Requirements 9/1/2018 4 Best Practice: TxCDBG recommends that the Grant Recipient review the Administrative Activities Checklist (Form A102) item-by-item, and identify the activities that will be performed by Grant Recipient staff and those that will require outside assistance.

9 It is also helpful to walk each staff member responsible for implementing the contract through the TxCDBG s program requirements. Administrative Thresholds For Release of Funds: A. The 12-Month Rule for Release of Construction Funds The Grant Recipient must submit all Start-up Documentation & Basic Federal Requirement Documentation (Group A) and Construction documentation (Group B) listed in CHAPTER 2 of this manual within 12 months of the contract start date. (See also TxCDBG contract, Exhibit D, Special Conditions.) If a Grant Recipient fails to meet this requirement, TDA will begin the process of contract termination. The TxCDBG contract ensures that the Grant Recipient will have an opportunity to resolve the deficiency as a part of the termination proceedings. For non-compliance with the 12-month rule: The Grant Recipient may submit a response to TDA within 30 days of the notice that termination proceedings have begun, providing a justification for the delay and a schedule for completing the Group A and Group B requirements.

10 All required documentation must be submitted within 90 days of the termination notice, or the date determined by TDA during the review of the Grant Recipient s response. For Applications after the Award of a TxCDBG contract: B. Applicant Threshold Requirements Grant Recipients currently receiving CDBG funding must be in compliance with the 12- and 24-month applicant threshold requirements in order to be eligible for new TxCDBG funding: 1. 12-Month Applicant Threshold Requirement - This rule requires applicants for future TxCDBG funding with existing TxCDBG contracts to obligate at least fifty percent (50%) of the total TxCDBG funds awarded under an open TxCDBG contract within twelve (12) months from the start date of the contract. This means that 50% of the TxCDBG funds must be obligated through executed contracts for administrative services, engineering services, acquisition, construction, materials purchase, etc.